Clean Car Package announced, implications for the West Coast

14 June 2021
Development West Coast
The Government has announced its Clean Car Package with a range of measures aimed at increasing the uptake of electric and plug-in hybrid vehicles to help New Zealand meet its 2050 carbon neutral target.

Clean Car Package

Through a rebate scheme, starting July 1, people buying new electric vehicles (EVs) and hybrid vehicles will be able to get up to $8,625 back from the Government, and up to $3,450 for used EVs and hybrids. The Clean Car discounts are not available for vehicles with a purchase price above $80,000.

From January 1, 2022, the introduction of fees on higher-emitting vehicles will contribute to the funding of the scheme. The fees will be payable by the vehicle purchaser to Waka Kotahi / NZ Transport Agency (NZTA) when the vehicle is first registered.

Transitioning to EVs more challenging for West Coast

Development West Coast Chief Executive Heath Milne says transitioning to EVs will play a crucial role in meeting New Zealand’s emissions targets, but the carrot and stick approach of the Clean Car Package fails to acknowledge the unique realities on the West Coast.

“Even taking into account the new rebate scheme, shifting to EVs will be considerably more challenging for the West Coast to achieve than most regions in New Zealand,” says Mr Milne.

“Given the distance between our dispersed communities, and lack of public transport, the West Coast has a relatively high rate of car ownership.

“There are currently over 21,000 registered light vehicles on the Coast, and only 37 of them are EVs.”

West Coasters typically keep their cars for longer. The region has the highest average vehicle fleet age in the country: 18.4 years, compared to 14.4 years nationally.

“There is currently no real second-hand market for EVs in New Zealand, with the cheapest new EVs costing over $50,000. In comparison you can pick up a new petrol car for under $30,000 – the rebates aren’t covering that difference,” says Mr Milne.

“The higher up-front costs of EVs presents a significant barrier to demand for regions like the West Coast that have lower average household incomes.”

The mean household income on the West Coast is $91,180, compared to $114,062 nationally.

“The size of our region may also create range anxiety amongst consumers,” says Mr Milne.

The Government stated “EV chargers are now available every 75 km along most state highways.” However, the NZTA website shows various key routes on the West Coast have significant distances between publicly accessible EV chargers, such as Hokitika to Franz Josef / Waiau (134.2 km), Greymouth to Westport (102 km), and Franz Josef / Waiau to Wanaka (284.3 km).

In addition to the challenges in transitioning to EVs, Mr Milne believes the proposed penalty fees for emitting vehicles may be disproportionately borne by rural communities such as the West Coast.

According to the Automobile Association, Kiwis will pay around $3,000 in penalties for popular utes, such as Toyota Hilux and Ford Ranger, under the new rules.

“On the Coast we have a significant primary industry sector, and utes are essential vehicles for many of our farmers and local businesses. It will be some time before electric utes are available in the market,” says Mr Milne.

“Given there are currently no electric alternatives, fees paid on new utes will inevitably go towards subsiding EVs that will predominantly be in the cities.”

“While we agree the shift to decarbonise land transport is desirable and an important step in meeting New Zealand’s emissions targets, the unique challenges and circumstances of the West Coast should be considered.

“Realistically the West Coast will require targeted assistance above and beyond what is currently proposed in the Clean Car Package, and a rethinking of penalties that will disproportionately impact rural regions.”